Category Archives: Better Supply Chains

Coaxing a Phoenix to rise from the Ashes of La Roya

This year, in the face of the leaf rust blight that has devastated coffee farmers across Latin America and the added insult that the coffee price on the international market have taken a sharp dive over the past year, Social Business Network has joined forces with The Community Agroecology Network and a farmer’s cooperative outside of Matagalpa called the UCA San Ramon to try to turn the onslaught of this double disaster into a turn for the better.  

One of the small member cooperatives of the UCA has been hard hit by the leaf rust, losing up to 85% of their harvest this year.  A walk through the coffee parcelas reveals not only the damage of the fungus but also signs of underlying stress and neglect – vines cover the coffee trees in certain areas, and in others the forest floor is bare and eroding.  The farmers recount the difficulties they face – first among them, the rising cost of fertilizers and fungicides, and difficulties securing financing.  Then the increased intensity of the diseases, which mean even more financing needed to purchase larger amounts of fungicides, narrowing even farther their profitability margin.

Historically this community has grappled with “organic” farming.  After a bad experience with poor technical assistance and costly certifiers, mentioning the word to any of the coop members sets off a tirade of a million reasons why “organic farming” doesn’t work.  Lack of quality organic fertilizers on the market and strict certification standards that rely heavily on verifying what farmers are NOT doing (NOT applying any agrichemicals, NOT using any non-certified off-farm inputs, not even their neighbor’s cow manure) have left many farmers frustrated and with the impression that organic farming means doing nothing and leaving everything up to mother nature.

Our new collaboration has kicked off by organizing a series of workshops bringing together the coop members, a local succesful bio-dynamic coffee farmer, and an agronomist.  For two days, we transformed a local school into a laboratory complete with microscopes and a centrifuge.  Even though the farmers have had their soil tested before, the samples are sent away to a laboratory and no one learns how the tests work.  Using a type of soil test called chromatography which reveals mineral content but also the microbial life of the soil, farmers were able to perform the entire soil test in their own community.  The agronomist, after a straightforward presentation on several different types of beneficial and detrimental fungi that either attack coffee plants or contribute to the plant’s better absorption of nutrients, went with the farmers to gather soil samples from around their farms and then used the microscopes to identify and see the different physical structures of different fungi.  Demystifying the invisible biological world that impacts so directly farmer’s livelihoods will hopefully not only empower them in this moment of crisis by giving them a new understanding of part of the crisis, but also impact how they manage their land.  Although it is common knowledge that the leaf rust virus travels by spores through the air, seeing the millions of tiny round balls on each leaf (see the image header on this post) revealed clearly how this fungus has been able to cause such devestation in the region.  Examples of beneficial fungi that were found locally were isolated using the microscopes and then used to innoculate seeds in sterilized soil to reproduce them and use them in a fertilizer that can be elaborated on-farm, improving the coffee plants absorption of minerals and nutrients in the soil.

The local farmer leading the soil chromatography process was very clear that this was not a workshop to promote organic agriculture, it was a workshop to promote better agriculture.  His own farm has only suffered a 15% decrease in production due to the leaf rust, well below the 50% national average.  In any other year he might have been met with glazed looks and disinterest from this group of farmers.  But this year, when the management systems they use have failed to mitigate the impact of this blight, their interest was keen, everyone participated, and they requested another workshop to continue deepening their understanding of soil life and assistance in using beneficial fungi to innoculate the new coffee seeds they will be planting to replace the portion of their farms that have perished due to the leaf rust.  Studies have shown that in small farmer cooperatives where management of the coffee and soil is tended to more carefully, there is less presence of rust.  Revealing the direct relationship between management and soil biology cuts through the layer of faith in purchased inputs that disempowers producers.  With the right approach, the double crisis hitting small coffee farmers right now could be transformed into an opportunity to reinforce better management practices that will help protect farmers and their livelihoods over the long term.

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Reclaiming Fair Trade – A Reflection

Presenting our first guest blog by Nora Burkey, who Social Business Network has the honor of hosting for her Master’s research in Sustainable Development: 

While fair trade enthusiasts are quickly dropping their affiliations with certifying bodies, explaining it is because they are still committed to original standards whereas new members are not, the confused reader, inundated with information about poor farmers just getting poorer—fair trade or not—might wonder why fair trade ought to be defended at all.  Remember that income accounting does not create the whole picture.  Fair trade has contributed to increased access to credit at lower interest rates, more childhood education, a greater degree of food-security, and more.  Fair trade premiums to cooperatives also benefit farming communities as a whole, such as greater access to healthcare for the whole village.  But fair trade wasn’t just about poverty, it was about revolution, and its successes and failures ought to be looked at in that light.

Fair Trade offered the cooperative structure as a solution to privately-owned farms that have an unfair system of wage labor.  This allows farmers ownership of their land, not just their labor, and provides a democratically governed body to oversee social projects and communicate with buyers without being owned by them, leaving decision-making with the farmer.  So when large coffee plantations can become certified as fair trade, as Fair Trade USA recently decided to allow—breaking off from Fair Trade International in order to do so—what we have is a private system that has nothing to do with what fair trade ever meant to imply, and what fair trade ends up meaning is something like minimum wage with a social premium benefit.  And whereas before 20% of a product had to be fair trade to receive the label, now just a mere 10% is required by Fair Trade USA, so it’s not even minimum wage for all.

Under current standards, to sell fair-trade certified products, only 5% of a company’s sales must be fair trade, and there is no obligation to increase this percentage over time.  Nor are large producers required to slowly become more cooperative in structure by giving each farmer a vote and ownership over their own production.  The presence of large multinationals and large plantations at the table only limits a small farmer’s access to the market and ensures the largest piece of the pie goes to the largest producer or buyer.

The most damaging of all is that the weakening of standards has forced the founders of fair trade out.  No longer do the truly committed want to be associated with the term they created, as to many consumers, it denotes something so tame the only impact it makes is a bad one.  It seems anyone can create their own label these days and certify it independently, allies and enemies alike.  Some have stricter standards and some have weaker, but if consumers are not educated, it is impossible to know which label is which.  And since fair trade depends on consumers rather than the state to ensure it continues to be a part of commerce—it only exists as long as people are willing to buy fair trade products—creating so many labels, and so much confusion, is a lot like playing with fire.

The struggle is whether to reclaim the name that has been co-opted or admit that it’s already been stolen.  In my own life I choose to reclaim it, because I believe it is important that people understand fair trade was and is not a failure, it can only be failed.  I choose not to be someone that fails it, to be someone who fails to support all that fair trade has done.  The commitment still feels pretty radical to me, in all senses of the word.

Nora Burkey is currently a candidate at SIT Graduate Institute for a Master’s in Sustainable Development.  She became involved with Social Business Network in August 2013 after connecting with Dean’s Beans Organic Coffee Company, a trading partner of ÉTICO.  She currently lives in León, Nicaragua, and plans to continue working with Dean’s Beans and Social Business Network on development projects into 2014.

When failures matter more

This year Nicaragua hosted the 2013 Human Development and Capability Association’s annual conference.  The three day event was held in the University of Central America and the participants represented a diversity of organizations and universities from 44 different countries.  The final speaker of the conference was Joshua Cohen, an American philosopher and professor at Stamford University.  His talk focussed on his experiences bringing together students from CA and Nairobi to design mobile technology innovations that address health and human development.  His examples included several pilots that failed – point being, it’s important to fail and learn from your failures so you can apply that to your next pilot.  As long as your keep trying, you will have success.  

In the Q&A, Social Business Network’s representative at the conference asked Cohen why it is acceptable for individual startups or pilots to repeatedly fail, while other models of business development such as cooperatives are written off when they fail.  While unfortunately Cohen agreed but couldn’t offer any further insight, it is worth considering when analyzing supply chains.  Many critics of Fair Trade, for example, will cite a failed cooperative business as proof that the model doesn’t work.  But how often do you read that private corporations are an inadequate model for development because one goes bankrupt?  We are quick to forgive or blame individuals for embezzlement, tax evasion, or bad management, but when the same problems occur within a cooperative or social business setting the structure is often scrutinized rather than the individual.  

Founding director of Social Business Network, Nick Hoskyns, talks about the importance for there to be a reason for a cooperative.  Because of the inherent egalitarian structure, cooperatives are often seen as an appealing method for social development.  But problems occur when the formation of the cooperative is seen as the end rather than the means to the end – with the goal being creating a successful business.  Cooperatives that are formed for the sole reason of bringing people together to raise themselves up out of poverty rarely succeed. Cooperatives are successful for the same reasons that private businesses are – they produce a quality product for a growing market.  And they fail for the same reasons that private companies fail – market shifts that make the same product cheaper from another source, bad management, or poor leadership.  successful cooperatively owned brands such as Ocean Spray, Cabot Creamery, and the Co-operative in England are not exceptions to a rule, they are examples of good business ethics and skills applied to a model that builds leadership and democracy, and encourages equal wealth distribution.

 

Women from the Juan Francisco Paz Silva cooperative in Achuapa, Nicaragua

Press Release – Successfull Celebration of Women’s Empowerment Initiative in Nicaraguan Supply Chains

First-ever initiative to count the unpaid work of women in agricultural commodity production is successful in Nicaragua 

Ético: The Ethical Trading Company Ltd., British NGO Social Business Network, and Nicaraguan farmer cooperatives celebrate the ground-breaking innovation to Recognise the Unpaid Work of Women in Ethical Supply Chains.

 Ético: The Ethical Trading Company and British NGO Social Business Network are pioneering the first ever initiative to Recognise the Unpaid Work of Women in Ethical Supply Chains. Traditionally, the price for commodity products include only direct input and labour costs, and fail to recognize or take into account the supporting unpaid work which is done mainly by women.  This is the first time that rural women’s unpaid work has been recognized as a necessary input into production and one that should be valued and remunerated. This initiative was presented on July 3, 2013 to a group of 100 invitees, including representatives from Fair Trade companies Twin, Equal Exchange, and Liberation Nuts, the Nicaraguan Embassy, UK Government officials and Tesco.  The event was organized by Ético and Social Business Network, with support from Hoare’s Bank, the Bulldog Trust, and Raleigh International.  The speakers explained the pilot stages and preliminary evaluation of the initiative with small-farmer sesame and coffee Cooperatives in Nicaragua.

The initiative developed in 2008 during a visit of the Body Shop with the Juan Francisco Paz Silva Cooperative in Achuapa, Nicaragua.  Ético gender advisor Catherine Hoskyns conducted a pilot study of women’s labour in sesame production.  Her initial findings revealed that when women’s indirect labour (eg. cooking food for field labourers) and more general domestic work are included, this counts for around 22% of the total labour input in sesame.  The results of the study were used to apply an additional cost to the price of the sesame oil for cosmetics, and has since been used to apply similar costs to the sales of coffee from Nicaraguan Cooperatives.  The Cooperatives use the increase in price margin to organize women’s empowerment activities in their communities, such as education, savings and loans schemes and labour organisation, which bring women together and strengthen the cooperatives.

Left to Right: (Back row) Liberty Pegg, Felicity Butler, Albert Tucker, Nick Hoskyns, Christina Archer (Front Row) Catherine Hoskyns, Rachel Lindsay, Julia Perez.  Photo Credit: George Selwyn

Left to Right: (Back row) Liberty Pegg, Felicity Butler, Albert Tucker, Nick Hoskyns, Christina Archer (Front Row) Catherine Hoskyns, Rachel Lindsay, Julia Perez. Photo Credit: George Selwyn

The event on July 3 demonstrated the transformative power of integrated supply chains.  It was held at 2 Temple Place and chaired by Albert Tucker, Director of Social Business Network.  The opening speech was given by Fiona Woolf, Lord Mayor Elect of the City of London and Trustee of Raleigh International, whose inspiration to support the event came from a visit to Nicaragua in 2012 where she was present at a meeting of women participating in the initiative.  She spoke of the impact that listening to the women’s experiences working with the program of the cooperative, and concluded, “That’s why… I will also be a champion for the unpaid work of women.  I think it has huge applications across the developed world as well as in the developing world.”  A vivid account of the different types of unpaid work which women do in Nicaragua was given by Julia Perez, of Achuapa Nicaragua, and Liberty Pegg, a former volunteer with Raleigh International. Catherine Hoskyns explained the initial calculation of women’s unpaid labour in sesame production and its significance, and Felicity Butler gave her first findings about the impact of the initiative. She is researching this through her Ph.D. at Royal Holloway University, which funded by the Economic and Social Research Council (ESRC) and The Body Shop.   Rachel Lindsay, representative of Social Business Network in Nicaragua, gave an overview of how this concept has been piloted in coffee sales and the support it has generated from the entire supply chain.  Christina Archer, Senior Buyer for Community Fair Trade Ingredients at the Body Shop, gave a testimony, emphasising that “This initiative does also make really good business sense, and strengthens the sustainability of supply chains… Our brand is about building self-esteem and empowering women, be they the women who use our products or the women in our supply chains”.  The event was concluded by Nick Hoskyns, Founding Director of Ético, who emphasised that when you bring together committed partners, you can use business to effect real change.   He emphasised that it was not easy to get this far but “with such good collaborators, many of whom are present, we have shown that we can still make trade fairer, just as we did with the establishment of Fair Trade”.  He also credited the cooperative organisations with being instrumental in the implementation of this initiative and using the additional funds so effectively for women’s empowerment.

Recognition of the Unpaid Work of Women

This summer Social Business Network and Ético will be celebrating our initiative to Recognize the Unpaid Work of Women in ethical supply chains.  Our pilot programme began in 2009 with the first-ever cost structure for an agricultural product that included economic remuneration for the traditional labor of women.

Much of the work women do in the production of agricultural commodities does not receive the recognition they deserve and is very often not remunerated.  These activities may be directly linked to production such as winnowing crops after they are harvested, safely storing crops at the home, and preparing food for field workers, or indirectly related to family production like fetching water, firewood and caring for children and elderly.  These are tasks that most rural women do regardless of whether their families grow crops for export, local sale, or autoconsumption.  Therefore, the value of the unpaid work of women has been calculated into the cost structure of our products and is included in the cost paid to the producer Cooperative.  The Cooperative uses these funds to empower women through making organizational, financial, and educational resources available to them.  Three years after the start of our pilot project, participation levels of women in the farmers cooperatives has risen sharply.  During a recent evaluation of the initiative with the Juan Francisco Paz Silva cooperative in Achuapa, Nicaragua, both women and men involved in the implementation were asked what the programme has accomplished since it’s inception.  Here are some of their responses:

  • a better relationship between women in rural communities (una mejor relación entre mujeres en las communidades)
  • women are taken into account (las mujeres son tomadas en cuenta)
  • more active participation by women (mejor participación activa de las mujeres)
  • development of creative potential in rural families (desarrollo de de creatividad en la economía familiar)
  • independence and security of having savings in their name (independencia y la seguridad de tener ahorros en sus nombres)
  • more women are joining the cooperative as full members (más mujeres se están uniendo a la cooperativa como socios)
  • other organizations are beginning to recognize the work women do (las mujeres son mas reconocidas por su trabajo de otras organizaciones)
  • a positive example of development for youth and the next generation (buen ejemplo para las/los hijos y jovenes y herencia generacional)

Social Business Network has partnered with trade companies, volunteer organizations, farmers cooperatives and universities to make this initiative possible.  Through our work this initiative has sparked lengthy passionate discussions about the roll of women and how to effectively recognize their contributions to society.  The academics we work with even raise the question of whether the unpaid work that women do in consumer countries has been successfully recognized yet?  This innovation in ethical trading clearly strikes universal chords. While it has been enthusiastically supported by buyers in several continents, it continues to be an organic development that offers as much through it’s process as with it’s results.  We are looking forward to celebrating these achievements and the bright future this programme has as it expands to help more rural women reach their full potential in their communities.